European Union's #10YearsChallenge: Interregnum

From 2009 to 2019, the EU has lost its social, political and economic appeal. As a result of the Brexit crisis, the refugee problem and the economic stagnation, the social movements such as the rising extreme right and yellow vests have caused the union to be depressed.

By Prof. Dr. Çağrı Erhan, Rector of Altınbaş University

The EU is going through one of the most critical periods in its 62-year history. The United Kingdom, which was able to access to the Union in 1973 on the third attempt only after pervious two were vetoed by French President Charles De Gaulle in 1963 and 1967, is now unable to walk out the door. Brussels wants the five-year lasting Brexit debate to be closed in one way or another. The inability to leave the Union does not only create problems for the British. It is also occupying and locking the EU's political and economic agenda. London's famous fog creates fuzzy and unfocused sight for all political leaders in EU capitals. But Brexit is not the EU's one and only problem during start of the year 2019. Since the entry into force of the Lisbon Treaty in December 2009, essential deepening problems have still not been resolved. Aftershocks of the financial crisis that started in 2008 and spread the EU countries has been ongoing. Moreover, in the EU countries with many relatively stronger economies, particularly in France, which was not directly affected by the 2008 crisis, the reactions of the lower and middle income groups of the society against the gradual decline in their life-quality are increasing. The populist and anti-EU discourse of the some parties campaigning for the European Parliament elections to be held on May 23-26, draws heavy attention. In most of the EU members xenophobic and anti-Muslim political parties are on the rise.

The center-right and center-left political movements, which are the basic assurance of the democracy in Europe are struggling to keep the ideal of the European Union alive and prevent the vanishment of multicultural harmony in their countries. Factors such as ongoing migration to the EU countries, terrorist attacks by radical groups, rising unemployment rates among the educated segments of the public, general economic stagnation and perhaps most importantly the lack of strong leaders throughout Europe make things hard for the central political movements.

While putting a title to this article, I have been inspired by the #tenyearschallenge hashtag, which has become a trend in social media recently. Taking into account some important indicators, the article mainly aims to discuss how far has the EU gone during the last decade. Moreover, it aims to evaluate to what extent a Union can be referred in the tenth year of the Lisbon Treaty, which was considered to be a very important step forward for the EU at those times.

Speaking to the European Parliament for the last time as the German Chancellor on 13th of November 2018, Angela Merkel - one of the rare European leaders which had been in charge in the last 10 years of the EU - considered the hallmarks for the future of the EU in a wise-woman manner as follows: 'Solidarity as a universal, fundamental value; solidarity as a responsibility for the community; and solidarity in terms of one's own rational interest.'

The fact that an experienced leader such as Chancellor Merkel stands so hard on solidarity has once again revealed the fact that the biggest obstacle for the EU claim to be a significant global actor is the lack of solidarity. According to the Chancellor, 'unity and common resolve are essential if Europe is to succeed.' To this end, she asserts, existence of unity and common resolve were significant in three areas: Common foreign and security policy, Europe's economic success and the topics of refugees and migration.'

Indeed, these areas, in which the EU has not managed to establish a common and stable attitude in the last decade, even jeopardize the EU as an inter-governmental institution, which claims to be the only supranational organization in the world.

WILL EU EVER BECOME A MILITARY GIANT?

Do you remember the St. Malo Declaration of 1998? 21 years ago France and the United Kingdom had 'agreed on the need to give the European Union (EU) the capacity for autonomous decision-making and action, backed up by credible military forces, in order to respond to international crises when the Atlantic Alliance is not involved.' At the same time, two countries agreed on 'to avoid unnecessary duplication, EU should take into account the assets of Western European Union (WEU)'. More than two decades later the European Army is still missing. Especially with Brexit, the EU's military capacity, which already fell short of the mark, will fall even further behind.

There is a frequently mentioned saying about the EU Army: 'The EU is an economic giant and a military dwarf '. Since he took up office, US President Donald Trump has drawn attention to this issue and wants EU countries to allocate more budget to defend the European continent. According to Mr. Trump, the European allies need to shoulder the responsibility for NATO to survive. But it is not realistic to think that EU countries, which have not made leaps ahead of economic indicators for the last 10 years, can now allocate as much as Mr. Trump wants to arm and defense. Especially in the times of the yellow vests taking to the streets of Paris, and the streets of other Western European cities, to protest the rising cost of living.

Nevertheless, EU countries have not given up their ambition to build a joint army. Under the EU's PESCO (Permanent Structured Cooperation) Programme started in late 2017, 25 countries committed troops to EU battle groups and vowed to launch projects that enhance the interoperability of their armed forces. It is quite thought-provoking that there is not even a single EU leader who believes that this ambitious project will give concrete results in the near future and expresses this belief aloud.

WHAT ABOUT ECONOMY AND POPULATION?

The EU achieved its top status in the Global Economy in 2007. That year, its GDP (PPP) was $14.4 trillion, almost $800 billion ahead of the US. The EU held onto its premier position through the 2008 financial crisis and the Eurozone debt crisis. According to IMF figures, during the last ten years, share of the EU in the World's total GDP has fallen from 19.5% to 16.4%. IMF estimates that this trend will continue in the following years and the EU's share will drop to 14.9% in 2023. In 2017 the EU's GDP reached $17.2 trillion.

On the other hand, the per capita GDP in the EU has steadily increased over the past 10 years. According to World Bank data, per capita income which was $ 33,500 in 2009 is above $ 37,000 today. These figures, of course, are related to the growth rate of the EU population, which is below the GDP growth rate. In the crisis environment in 2009, the EU, which its economy has reduced by 4% back then, grew by 2% last year. The total population of the EU, which was 502 million in 2009, reached 512.7 million in 10 years. In other words, since 2009, the EU's GDP grew by almost 20% while its population grew by only 2%.

Nevertheless it is unnecessary to question EU's global economic power. But there exits an increasing challenge form People's Republic of China and India. The next decade will be more difficult for the EU economies than for the past ten years. On the other hand, the share of the 4 EU countries within the World's top 10 largest economies continues to fall steadily. Germany fell from 3.71% to 3.18%, from 2.7 to 2.15 in France, from 2.63 to 2.2 in UK, from 2.4 to 1.73 in Italy. Turkey's share rose from 1.35 to 1.66 last decade, the country that still being held in abeyance for EU in the light of unjustified reasons and groundless claims, even after 14 years of full membership negotiations began in 2005.

For the EU economy, there are some more striking indicators than the decline in the share of the global GDP. Perhaps we should try to understand the root causes of social and political turmoil in the EU, which are subject to Merkel's warnings, by looking at these indicators. In particular, the fact that the extreme parties are becoming more effective throughout Europe and the fact that EU cannot become a stronger union, are based on these indicators.

The average unemployment rate in EU countries, which was 10% in 2013, declined to 7%. The unemployment rate in Eurozone is 8.3%. However, unemployment rates in Spain, France and Italy, which have a high capacity to affect the overall EU in terms of both population and economic size, continue to be above average. After 10 years of painful and shaky period, the unemployment rate still remains above 20% in Greece.

On the other hand, when the unemployment rate of the young population is considered, the average unemployment rate of the EU is 15.1%. Greece, is the spearhead in youth unemployment with 42%, Spain, 34% and Italy follows with the rate of 32%. Youth unemployment rates in France and Portugal are also above 20%. Perhaps these are the rates that need to be taken into consideration. There is a direct link between high unemployment rates among young people and social tensions.

While we are talking about unemployment rates, we should also look at the population indicators of the EU citizens that settle and work in a different EU member country. We see that some political leaders in France and Italy associate youth unemployment in their country with the population coming from other EU countries, rather than migrants from outside Europe. Thus, not only the influx of refugees but also the freedom of EU citizens to settle and work in any EU country they want, which is one of the EU's fundamental principles, is also open to debate.

20% of Romanians, Bulgarians (12.5 %), Latvians (12.9 %), Portuguese (13.9 %), Croats (14.0 %) and Lithuanians (15.0 %) are settled in another EU country rather than their own country. The population of EU countries is getting older. The median age of the EU countries increased to 44 today, which was 36.8 twenty years ago. Indeed much of the Europeans are living longer and healthier lives: increasing life expectancy may be linked to medical advances and greater health awareness. The EU is also experiencing historically low fertility rates, below the natural life replacement level. Life expectancy in the EU is 79 for males and 84 for females. As a matter of fact the portion of Europeans over the working age is increasing and the portion of Europeans below the working age is decreasing. In sum, EU is getting older.

Finally, the amount of government debt puts a serious threat for economies of some EU countries, as well as the balance of the Eurozone. According to Maastricht convergence criteria, which was agreed upon 1992, the government debt must not exceed 60% of the GDP. Today, the average of the EU countries is 20 percentage points higher than those envisaged in Maastricht, reaching 80%. This rate is 86% in Eurozone countries. Public debt-to-GDP ratio of Greece (180%), Italy (133%), Portugal (126%), Belgium (106%), Spain (98%) and France (99%) are threatening for the future of the Euro.

IMMIGRANTS AND EXPECTATIONS

According to EU statistics, the number of people residing in an EU Member State with citizenship of a non-member country in 2017 was 21.6 million, representing 4.2 % of the EU-28 population. In addition, there were 16.9 million persons living in one of the EU Member States in 2017 with the citizenship of another EU Member State. Almost 38 million people living in EU countries have birth places different than the EU.

The largest numbers of non-nationals living in the EU Member States in 2017 were found in Germany (9.2 million persons), the United Kingdom (6.1 million), Italy (5.0 million), France (4.6 million) and Spain (4.4 million). Non-nationals in these five Member States collectively represented 76 % of the total number of non-nationals living in all of the EU Member States, while the same five Member States had a 63 % share of the EU-28's population.

The median age of immigrants to EU countries is 8 years below the EU average. Some European employers consider this fact as a remedy for the EU's failure to create a young population and the decline in fertility. But there are also those who use this indicator for xenophobia by thinking the opposite.

Since 2009, nearly 5.5 million people have applied for asylum in EU countries. The largest number of asylum applications in this time period was recorded in 2015 as 1.23 million applications. But this figure showed a 40% decline in the following year. On the other hand, the number of refusals of entry into the EU rose by 45 percent from 2009 to 2016.

The tragedies faced by asylum seekers who set off from the Middle East countries and from North Africa to the EU casted a great shadow on everything and knocked sideways in the 10 years we have left behind. According to UNHCR statistics, the number of asylum seekers who lost their lives in the Mediterranean was approached to 1800 while trying to reach Europe only in 2018. Although there are no reliable statistics, there are reports that approximately 20,000 people have lost their lives in the last 10 years. The measures taken by the European Border and Coast Guard Agency, fka Frontex, are mainly aimed at preventing asylum-seekers from coming to EU countries. But it is a fact that EU governments should take more deep socio-economic measures to bring the living conditions of asylum seekers to the humanitarian standards and, above all, to ensure that those who come to make a new start by escaping armed conflicts and poverty.

HOW MANY MORE YEARS FOR WAITING AT THE DOOR?

During the last ten years, Turkey continued to wait for EU accession. Two decades have passed since the country was declared a candidate for EU in 1999, and 14 years have passed since the opening of the first negotiation chapter in 2005. Brussels, especially after the financial crisis in 2008, has taken no positive steps that opens the membership doors to Turkey. On the contrary, presence of the factors such as problems of deepening and enlargement, refugee crisis, increased security problems led to the emergence of political circles utter much more, those who oppose Turkey's EU membership.

Although Turkish public opinion prospect of EU membership has decreased, Turks' rate of supporting the accession to the EU is around 60%. Full membership to the EU remains one of the political priorities of the government. In the coordination of the Ministry of Foreign Affairs' Directorate for EU Affairs, the works for alignment with the EU acquis of all ministries and public institutions does not slow down. The participation of universities in EU programs has seen a significant increase over the decade. With partners from EU countries Turkish universities are included in many EU programs, especially Horizon 2020 and Erasmus +. Since 2014, nearly 15,000 students, academicians and administrative staff have been attending universities in the EU countries for education and internships.

Although there is no concrete commitment from Brussels to open new negotiation chapters and abolish the visa regime for Turkish citizens, economic relations between the EU and Turkey continues to be stable in the framework of the Customs Union in particular.

While Turkey's exports to EU countries valued 63.7 billion euros in 2008, it reached around 74 billion euros in 2017. In 2008, Turkey's imports figure to EU countries was approximately 74 billion euros; this figure rose to 85 billion euros in 2017. Turkey remains to be the fifth country in the list of the largest trading partners of the European Union with these figures. The EU's share in Turkey's total trade fell from 41.4% to 40.7% over the same period.

Despite of cyclical developments that tenses Turkey-EU relations occasionally, both sides view the world economy through the same window of principles. In his speech at the Opening of the 73rd Session of the UN General Assembly, Turkey's President Recep Tayyip Erdogan underlined that there should be no unilateral intervention in the global economy, and revealed that Turkey has similar approaches with the EU.

At a time when the Transatlantic Trade and Investment Partnership (TTIP) negotiations between the United States and the EU were almost completely suspended, and the cold winds of trade on both sides of the Atlantic, President Erdoğan stressed that trade wars harm humanity in every single period. Erdogan also added that they could not be kept silent in the face of arbitrary cancellation of commercial agreements, widespread protectionist policies and the use of economic sanctions as weapons.

In the words of Erdogan in UN, Turkey supports both trade and travel liberties. Turkey is right behind of solving problems with constructive dialogues to be conducted on equal terms. Of course, these statements can also be interpreted as to give a new vitality on Turkey-EU relations in the future.

In 1959, Turkey had applied for associate membership of the EEC (fka). At that time, the UK was not even a member of the Common Market. 60 years have passed. The Customs Union, which entered into force in 1996 as a product of the Ankara Association Agreement signed in 1963, is still functioning despite all the need for renewal and updating. But we are going through an extremely turbulent period that the EU cannot see Turkey as a trade partner only. If the EU wants to be an actor that have a say in the 21st century at the global level, Brussels should start a new process of accession negotiations which will be completed as soon as possible, by reviewing its approach to Turkey. Turkey is a country that will make the EU stronger in a strategic point of view by its geographical location of on energy routes, increasing weight in the world economy, the active position in the G-20 and its balancing role in regional stability.

However, while the Brexit crisis continues, ahead of the upcoming European Parliament elections to wait any positive assessment about Turkey's membership to be made in EU capitals would be unrealistic. Once upon a time there was a lot of people in Turkey who sees joining to the EU as an opportunity. Who knows, maybe EU is the one that misses the boat.